DRAFT Chapter 2: What Happened to Trust?
For comment, draft second chapter of “Renewing Trust in America,” from the Knight Commission on Trust, Media and Democracy
Why Has Trust in Government Declined?
1. Poor institutional performance
2. Large-scale global “shocks”
3. Political polarization
Chart: Growth of Political Polarization, 1994–2017
4. Increasing economic inequality
Chart: Income Inequality in the United States, 1910–2012
Chart: Trust in Government and Perceptions of Government Fairness
5. Declining economic mobility
Chart: US economic mobility from 1940 to 2000
Findings: Chapter 2
In Chapter 1, this report documented the decline in Americans’ trust of government over the past half century, from a peak in the 1960s to near an all-time low today. We also noted that declining trust is not limited to government alone, but affects other key societal institutions, including business and media.
There are some who believe that the wide-ranging loss of trust is reaching crisis proportions. In his introduction to the 2017 Edelman Trust Barometer, titled “An Implosion in Trust,” Richard Edelman warns that:
Trust is now the deciding factor in whether a society can function. As trust in institutions erodes, the basic assumptions of fairness, shared values and equal opportunity traditionally upheld by “the system” are no longer taken for granted.
We observe deep disillusion on both the left and the right, who share opposition to globalization, innovation, deregulation, and multinational institutions. There is growing despair about the future, a lack of confidence in the possibility of a better life for one’s family. The 2017 Edelman Trust Barometer finds that only 15 percent of the general population believe the present system is working, while 53 percent do not and 32 percent are uncertain.
A year later, the situation is even more dire: “the U.S. is enduring the worst collapse in trust ever recorded in the history of the Edelman Trust Barometer.” The 2018 report notes that the loss of trust has now extended from specific institutions to a “loss of belief in reliable information . . . perhaps the most insidious of all because it undermines the very essence of rational discourse and decision making.”
What accounts for this collapse of trust? In this chapter, we review a variety of explanations that have been offered for the decline in trust in government and democracy and consider their social and political implications. This chapter provides the larger socio-political scaffolding that will also impact trust in media, covered in the following the chapter.
Why Has Trust in Government Declined?
At least five different explanations have been offered for the decline in trust in government. They include three big social/political factors — poor institutional performance, large scale global “shocks,” and growing political polarization — and two more specifically economic factors: rising economic inequality, and declining economic mobility.
1. Poor institutional performance
Perhaps the most straightforward explanation for falling trust in government is poor performance by those in power. According to political scientists Kenneth Newton and Pippa Norris, when institutions perform poorly, people lose trust in them: “It is primarily governmental performance that determines the level of citizen’s confidence in public institutions.” One indicator of the public’s lack of faith in government is their view of the competency of political leadership: A 2015 Pew survey found that a majority (55 percent) of Americans believed that “compared with elected officials, ordinary Americans would do a better job of solving the country’s problems.”
Starting with the Vietnam War and Watergate, a series of governmental actions challenged citizen trust. The events leading up to the Clinton impeachment, where the President was accused of lying under oath; the Iraq War, which turned out to have been launched under false assumptions; down to the gridlock that seems to have dominated U.S. political processes in recent years, have provided ample grounds for Americans to doubt the effectiveness of their government. And news media, which emphasize conflict, scandal and dysfunction, could well be contributing to the loss of trust.
2. Large-scale global “shocks”
To account for the “crisis in trust” that has grown over more than a decade Richard Edelman points to a series of social and economic “waves” that have shaken the faith of people in many countries, not least in the United States, in key institutions.
- The first wave was a fear of job loss and economic dislocation caused by the forces of globalization and automation that unfolded over a period of many years. In both cases, the consensus of economists has been that these forces have been net positives in terms of overall economic growth. But it is also true that the benefits of globalization and automation have been skewed: both have produced increased economic volatility that has displaced millions of workers even as new jobs have been created.
- The second wave was the Great Recession of 2008 that “created a crisis of confidence in traditional authority figures and institutions while undermining the middle class.” All recessions have negative consequences, but the impact of the 2008 recession was especially severe. According to the Pew Charitable Trust, combined peak loss from declining stock and home values totaled $10.8 trillion, or an average of nearly $100,000 per U.S. household, during the period from July 2008 to March 2009. Millions of jobs were lost and many governments were forced to reduce their budgets significantly, resulting in cuts to critical services such as public education.  Although U.S. economic growth since then has made up for many, but not all, of these losses, the setbacks and emotional scars from this time still linger.
- The third wave was based on fears and uncertainty brought about by “massive global migration.” The influx of immigrants to this country has led many, especially among working-class Americans, to “feel like strangers in their own land.”
- The fourth and most recent wave that has exacerbated a loss in trust was brought about by the rise of disinformation that has resulted in a sort of Gresham’s Law for information. False or misleading news stories have been competing with and perhaps crowding out accurate stories and seeding doubt about the reliability of news in general. One consequence of this most recent wave has been that, for the first time, media has become the least-trusted of the various global institutions tracked by Edelman. If citizens believe that they cannot rely on media for a truthful account of political activities, it is likely to encourage doubts about the legitimacy of government and its actions. It should be noted, however, that people are more likely to trust the news media they use (“my media”) than the news media generally. (The nature of the new media landscape and its implications are described in more detail in the next chapter.)
3. Political polarization
A third factor offered as a cause of declining trust is the steady increase in political polarization in the U.S. that has resulted in the emergence of two political camps — Democrats and Republicans — whose views on a wide range of issues have drifted farther and farther apart. Data from more than twenty years of polling by the Pew Research Center graphically show this widening gulf. While there was a large overlap in political values between members of the two parties in 1994, by 2017, the amount of common ground between the two had shrunk considerably and the gap between the median values of Democrats and Republicans was much greater.
Growth of Political Polarization, 1994–2017
As the gap has grown, so has anxiety about the other party. According to a 2016 report from Pew:
More than half of Democrats (55 percent) say the Republican Party makes them “afraid,” while 49 percent of Republicans say the same about the Democratic Party. Among those highly engaged in politics — those who say they vote regularly and either volunteer for or donate to campaigns — fully 70 percent of Democrats and 62 percent of Republicans say they are afraid of the other party.
As antipathy toward the other party has grown, it seems logical that the “out” faction, whose views and values bear little in common with the party in power, would be less likely to feel comfortable and confident, and therefore less trusting, in the way that the “in” party operates the government.
A recent potential contributor to growing polarization has been the rise of so-called “filter bubbles” and “echo chambers” online. To provide “personalization,” web-based social media platforms tailor the information provided to users to respond to their interests and viewpoints. For example, algorithms developed by Facebook have been designed to shape each user’s newsfeed to favor information from “people like them” that is most likely to be appealing to them. As these algorithms improve, it makes it possible for people to inhabit online worlds — filter bubbles — that are almost hermetically sealed off from those of others with different perspectives. The irony is that the Internet, which originally promised to be a tool for enlightenment and liberation by providing everyone with access to all of human knowledge, has, according to some critics, ended up isolating each user in a “unique, personal universe of information created just for you by an array of [invisible] personalizing filters.”
In the realm of politics, this phenomenon has resulted not merely in polarization but in a fragmentation in which the body politic has shattered into myriad separate “echo chambers” of groups — some small, some considerably larger — that share similar viewpoints. In a white paper for this Commission, Jeffrey Abramson describes this phenomenon as “the balkanization of the public into separate news-consuming spheres,” and warns that it is “difficult for trust to spread among partisans when the news they receive does not offer a shared, baseline of common information.” (As discussed in the next chapter, in response to criticism of the negative effects of social media, these companies have begun to make changes in how they handle the distribution of news and the discussion of it.)
Yet another form of polarization is the split in values and perspectives between rural residents and urban dwellers, which has been described as “spatial polarization” — a world of “blue states” clustered along the country’s two coasts, and “red states” filling the vast but more sparsely populated heartland of the country.
As polarization increases, the notion of government as a joint enterprise that tolerates disagreement but ultimately works toward compromise in order to get things done seems increasingly quaint. In his 2012 book, Twilight of the Elites, Christopher Hayes argues that the country’s political divide has evolved past the traditional distinction between “left” and “right” or between Republican and Democrat. The country, he suggests, is now divided into two disparate camps that he describes as institutionalists and insurrectionists. Institutionalists continue to believe in the fundamental legitimacy and necessity of a “central repository of authority,” and therefore are committed to defending the current government, despite its flaws. Insurrectionists, on the other hand, are convinced that “there is something fundamentally broken about our current institutions . . . and believe that the only way to hold our present elites accountable is to force them to forfeit their authority.” While institutionalists see the erosion of trust as “terrifying,” insurrectionists “see the plummeting of trust in public institutions as a good thing.” Finding a path forward in terms of restoring trust in democracy that will be acceptable to both factions will be challenging.
4. Increasing economic inequality
The decrease in trust in American institutions, including government and the media, generally correlates with an increase in economic inequality. As charted by Thomas Piketty and others, after a period of declining inequality from the 1930s through the 1950s (from the end of the Depression through World War II) followed by several decades of relative stability, inequality began rising sharply in the mid-1970s and is now at levels not seen for nearly a century and is still increasing. . 
Income Inequality in the United States, 1910–2012
(Top Decile Income Share, 1917–2015)
Several studies have found links between inequality and institutional trust. Political scientists Mitchell Brown and Eric M. Uslaner, University of Maryland, found that, in fact, “economic inequality is the strongest determinant of trust.” They also suggest that “where inequality is higher, the poor may feel powerless. They will perceive that their views are not represented in the political system and may opt out” of participation. However, their research found that the erosion of trust based on increasing inequality appears to have a stronger impact on “communal participation” (volunteering or giving to charity) than on political participation (voting, signing petitions). A 2016 working paper for the International Monetary Fund found “robust evidence that overall inequality lowers an individual’s sense of trust in others in the United States as well as in other advanced economies.”
There are other indicators of a link between economic inequality and trust. One example is attitudes in rural communities in places like the Rust Belt and sparsely populated Western States, compared to those in urban areas, a manifestation of the “spatial polarization” cited above. Research by Catherine Cramer suggests that “the rural consciousness revealed [in her study] shows people attributing rural deprivation to the decision making of (urban) political elites, who disregard and disrespect rural residents and rural lifestyles. Thus, these rural residents favor limited government, even though such a stance might seem contradictory to their economic self-interests.”
Another perspective on inequality and trust comes from Angus Deaton, Nobel Prize-winning economist from Princeton University, who argues that the key variable in shaping attitudes toward society and politics is not inequality per se but rather the perception of the fairness of the economic system. Deaton argues that people generally accept some forms of inequality — for example, the success of innovators and inventors who are rewarded for their creativity — as fair and therefore unobjectionable, while other forms of inequality — such as unequal access to healthcare and quality education, the elimination of pension benefits for workers, anti-competitive practices of large corporations, or government policies favoring businesses over individuals — are typically perceived as the result of unfair economic or political processes.
Evidence that supports this hypothesis comes from survey data from the Pew Research Center that has found that “trust in government” and “perceptions of the fairness of government” track each other very closely, following almost identical paths over the past half century. As of 2015, Pew found that “just 19 percent say the government is run for the benefit of all — and an identical percentage says they can trust the federal government just about always or most of the time.”
Trust in Government and Perceptions of Government Fairness
5. Declining economic mobility
A final factor, related to economic inequality, that may be a driver of declining trust is the level of economic mobility as measured by the percent of children who achieve an income higher than that of their parents. A 2017 study, titled “The Fading American Dream,” by a group of economists from Harvard and Stanford, found that mobility has declined dramatically, from approximately 90 percent for the cohort of children born in 1940 to 50 percent for the cohort born in the 1980s, with the largest declines occurring in middle class families. The study attributes most of the decline in mobility to the uneven distribution of economic gains, with most going to the top earners and much less to the rest of the population.
US Economic Mobility from 1940 to 2000
According to Christian Houle in a 2017 paper, “inequality and social mobility, although related, are fundamentally distinct, and immobility is likely to be perceived as even more unfair than inequality, meaning that it may generate at least as much grievances. In this article, I argue that social immobility fuels political instability.” If, in fact, the key variable in the loss of faith in government is the perception of unfairness, then it would follow that low social mobility may be a significant causal factor.
Finally, it should be noted that these explanations are not mutually exclusive. In fact, it is likely that a combination of some or all of these factors are implicated in the decline in trust in democratic institutions.
To provide a context for the Commission’s recommendations, the next chapter offers, first, a closer look at the current media environment and how it evolved,and second, possible explanations for the decline in trust in media.
Findings: Chapter 2
A. Potential Reasons for the Decline in Trust in Government
a. Large-scale global economic, social and political “shocks” have shaken people’s faith in a variety of democratic institutions including government.
b. Poor performance in effectively safeguarding the public interest and delivering expected services erodes confidence in government.
c. Growing political polarization contributes to a diminished willingness to support a shared political enterprise that necessarily operates through compromise.
d. An increase in economic inequality and a declining belief in fairness of government weaken trust in the institution.
e. Declining economic mobility diminishes faith in government as a mechanism to provide opportunities for all.
 Richard Edelman, Executive Summary, 2017 Edelman Trust Barometer, January 15, 2017, https://www.edelman.com/executive-summary/
 Richard Edelman, “The Battle for Truth — Trust, Media and Democracy,” Medium, January 22, 2018, https://medium.com/trust-media-and-democracy/the-battle-for-truth-edelman-com-3404077559eb.
 Kenneth Newton and Pippa Norris, Confidence in Public Institutions: Faith, Culture or Performance? Paper for presentation at the Annual Meeting of the American Political Science Association, Atlanta, 1–5th September 1999, https://sites.hks.harvard.edu/fs/pnorris/Acrobat/NEWTON.PDF.
 Beyond Distrust: How Americans View Their Government, Pew Research Center of U.S. Politics and Policy, November 23, 2015, http://www.people-press.org/2015/11/23/8-perceptions-of-the-publics-voice-in-government-and-politics/#publics-assessment-of-countrys-problems-own-ability-to-address-them.
 On the economic impacts of globalization, see Matthew C. Klein, “How many manufacturing jobs were lost to globalization?” Financial Times, December 6, 2016, https://ftalphaville.ft.com/2016/12/06/2180771/how-many-us-manufacturing-jobs-were-lost-to-globalisation. On the effects of automation, see James Manyika, Jobs Lost, Jobs Gained: Workforce Transitions In A Time Of Automation, McKinsey Global Institute, December 2017, https://www.mckinsey.com/~/media/McKinsey/Global%20Themes/Future%20of%20Organizations/What%20the%20future%20of%20work%20will%20mean%20for%20jobs%20skills%20and%20wages/MGI-Jobs-Lost-Jobs-Gained-Report-December-6-2017.ashx.
 The Impact of the September 2008 Economic Collapse, Pew Charitable Trusts, April 10, 2010, http://www.pewtrusts.org/en/research-and-analysis/reports/2010/04/28/the-impact-of-the-september-2008-economic-collapse.
 Daniel Cox, Rachel Lienesch and Robert P. Jones, “Beyond Economics: Fears of Cultural Displacement Pushed the White Working Class to Trump,” PRRI/The Atlantic Report, May 9. 2017, https://www.prri.org/research/white-working-class-attitudes-economy-trade-immigration-election-donald-trump.
 For a counter-argument about the actual impact of disinformation, see Danielle Allen and Justin Pottle, Democratic Knowledge and the Problem of Faction, Knight Foundation White Paper, https://kf-site-production.s3.amazonaws.com/media_elements/files/000/000/152/original/Topos_KF_White-Paper_Allen_V2.pdf.
 Richard Edelman, op. cit.
 “People have more trust in ‘my’ media than ‘the’ media”, American Press Institute. May 24, 2017. https://www.americanpressinstitute.org/publications/reports/survey-research/my-media-more-trusted-than-the-media
 “The Partisan Divide on Political Values Grows Even Wider,” Pew Research Center, October 2017, http://assets.pewresearch.org/wp-content/uploads/sites/5/2017/10/05162647/10-05-2017-Political-landscape-release.pdf.
 Pew Research Center, Partisanship and Political Animosity, June 2016, http://assets.pewresearch.org/wp-content/uploads/sites/5/2016/06/06-22-16-Partisanship-and-animosity-release.pdf
 The term was popularized by Eli Pariser in his book, The Filter Bubble: How the New Personalized Web Is Changing What We Read and How We Think (Penguin Books, 2012).
 Jeffrey Abramson, Trust and Democracy, Knight Commission on Trust, Media, and American Democracy, The Aspen Institute, July 2017.
 For a discussion of the dynamics of spatial polarization, see Kevin B. Sullivan, “American Distrust: Can the Country’s Tribal Differences Be Bridged?” Commonweal, March 30, 2018, https://www.commonwealmagazine.org/american-distrust.
 Christopher Hays, Twilight of the Elites (New York: Crown Publishers, 2012), pp. 17–18.
 Thomas Piketty and Emmanuel Saez, Income Inequality in the United States, 1913–1998, NBER Working Paper №8467, September 2001, www.nber.org/papers/w8467.
 Mitchell Brown and Eric M. Uslaner, “Inequality, Trust, and Civic Engagement,” American Politics Research, Vol. 31 No. X, 2003, https://www.russellsage.org/sites/all/files/u4/Uslaner percent20and percent20Brown.pdf.
 Eric D. Gould and Alexander Hijzen, “Growing Apart, Losing Trust? The Impact of Inequality on Social Capital,” IMF Working Paper WP/16/176, August 2016, https://www.imf.org/external/pubs/ft/wp/2016/wp16176.pdf. Ethan Zuckerman questions the validity of the connection between inequality and trust by pointing out that if rising inequality were the cause of declining trust, “we would expect to see rising inequality accompanied by a steady drop in consumer confidence” (a measure of individuals’ attitudes toward current and future economic conditions). But this has not occurred: “consumer confidence in the U.S. and in the OECD [countries] is roughly as high now as it was in the 1960s.”
 Katherine Cramer, The Politics of Resentment: Rural Consciousness in Wisconsin and the Rise of Scott Walker, 2016. University of Chicago Press. See also: Katherine Cramer, “Putting Inequality in Its Place: Rural Consciousness and the Power of Perspective,” July 30, 2012, American Political Science Review. https://doi.org/10.1017/S0003055412000305
 Angus Deaton, How Inequality Works, Project Syndicate, December 21, 2017, https://www.project-syndicate.org/onpoint/anatomy-of-inequality-2017-by-angus-deaton-2017-12.
 Beyond Distrust: How Americans View Their Government, Pew Research Center, November 23, 2015, http://assets.pewresearch.org/wp-content/uploads/sites/5/2015/11/11-23-2015-Governance-release.pdf.
 Raj Chetty, David Grusky, Maximilian Hell, Nathaniel Hendren, Robert Manduca, Jimmy Narang, “The fading American Dream: Trends in absolute income mobility since 1940,” VOX, May 5, 2017, http://voxeu.org/article/trends-us-absolute-income-mobility-1940.
 Christian Houle, “Social Mobility and Political Instability,” Journal of Conflict Resolution, August 8, 2017, http://journals.sagepub.com/doi/pdf/10.1177/0022002717723434.